Health insurance is one of the most important purchases you'll make all year. Comparing health plans and finding health insurance quotes and information has never been easy.
Take heart, though. You have important consumer protections on your side, brought to you by the Affordable Care Act, also known as ObamaCare, which is still in effect for now. With a little know-how and research, you can find a health plan to cover you and your family.
When to buy a health plan
Before 2014, you could buy an individual health plan at any time of the year. But now, except for special circumstances, you can purchase individual coverage only during the period known as open enrollment.
Open enrollment for 2020 health plans runs in most states from Nov. 1, 2019 to Dec. 15, 2019.
However, some states are extending the time that people have to buy health insurance. Currently, those states are:
- California – Oct. 15, 2019 to Jan. 15, 2020
- Colorado – Nov. 1, 2019 to Jan. 15, 2020
- D.C. – Nov. 1, 2019 to Jan. 31, 2020
- Massachusetts – Nov. 1, 2019 to Jan. 23, 2020
- Minnesota – Nov. 1, 2019 to Dec. 23, 2019
- New York – Nov. 1, 2019 to Jan. 31, 2020
- Rhode Island – Nov. 1, 2019 to Dec. 23, 2019
You can buy a health plan outside the open enrollment period if you have a "qualifying life event," such as moving outside your insurer's coverage area, getting married or having a baby. You can also buy coverage outside the open enrollment period if you had a special situation that prevented you from enrolling earlier.
The main qualifying life events that will give you a 60-day “special enrollment period” are:
- Getting married
- Having a baby, adopting a child or placing a child for adoption or foster care
- Becoming a U.S. citizen
- Leaving incarceration
- Losing other health coverage due to job loss, divorce, COBRA expiration or aging off a parent’s plan
- Losing eligibility for Medicaid or the Children’s Health Insurance Program (CHIP)
- For people with a marketplace plan already, having a change in income or household status that affects eligibility for premium tax credits or cost-sharing reductions
- Gaining status as a member of an Indian tribe
You can sign up at any time of year for Medicaid or CHIP, which are federal and state insurance programs for low-income families.
There is no longer an individual mandate penalty if you don't have health insurance.
You can’t be declined for an individual health plan
Before health care reform, individual health plans varied widely in what they covered. Insurers could deny your application for insurance or boost your premiums if you had a health condition.
Now insurers have to cover you regardless of your health history, and they can't charge you more because of medical conditions. You qualify for health insurance even if you're pregnant, have a long-term condition like diabetes or a serious illness such as cancer. Health plans also can't cap the amount of benefits you receive, and they can't make you pay more than a certain amount out of pocket for health care each year. In addition, all individual health plans must cover a standard set of 10 benefits:
- Outpatient care (such as doctor's office visits)
- Emergency room visits
- Hospitalization (such as surgery)
- Pregnancy and maternity care
- Mental health and substance abuse treatment
- Prescription drugs
- Services and devices for recovery after an injury or due to a disability or chronic condition
- Lab tests
- Preventive services, including a variety of health screenings, immunizations and birth control. You pay nothing out of pocket for preventive care when you see health care providers in a health plan's network.
- Pediatric services, including dental and vision care for kids
Types of individual health plans
Although they must cover certain benefits, health plans still vary in how they are structured and how much of your health care costs they pay.
Health plans in the Affordable Care Act marketplace are divided into five categories to make comparing them easier. The categories are based on the percentage of health care costs the plans pay and the portion you pay out of pocket, including the deductible, copayments and coinsurance. The percentages are estimates based on the amount of medical care an average person would use in a year.
- Bronze - Pays 60% of your health care costs. You pay 40%.
- Silver - Pays 70% of your health care costs. You pay 30%.
- Gold - Pays 80% of your health care costs. You pay 20%.
- Platinum - Pays 90% of your health care costs. You pay 10%.
Generally, the less you pay out-of-pocket for the deductible, co-payments and co-insurance, the more you pay in premiums for the coverage. So, in this case, Platinum plans will charge higher premiums than the other three plans, but you won't pay as much if you need healthcare services. Bronze, meanwhile, has the lowest premiums, but the highest out-of-pocket costs.
So, when deciding on the level, think about the healthcare services you used over the past year and what you expect for next year. For instance, if you plan on starting a family, take into account how much out-of-pocket costs you'll have to pay if you go with a Bronze plan.
Bronze and Silver are the most popular plans. Not many people have Platinum plans. One reason is the difference in costs.
eHealth reported the average monthly premium by metal level:
- Bronze -- $440
- Silver -- $481
- Gold -- $596
- Platinum -- $706
Health maintenance organization (HMO) plans are the most common type of plan design in the individual market. eHealth estimated that 56% of individual plans are HMOs. A mere 15% were preferred provider organization (PPO) plans. PPOs are the most common type of employer-sponsored plans.
How to buy individual health insurance
Ready to shop? You have lots of choices: Comparison websites, going directly to a health insurance company via its website or call center, contacting a health insurance agent in your area or using your state’s health insurance marketplace (also called exchange).
Not all insurers sell plans through the government-run marketplaces, so you'll find more options by shopping both in and outside the marketplaces.
If you qualify for subsidies, you can get them only by buying through your state’s health insurance marketplace. Healthcare.gov has links to state marketplaces.
You could be eligible for a premium discount in the form a tax break if your income falls below 400% of the federal poverty level (FPL). For 2020 health plans, the 400% threshold is $49,960 for a single person. Here are more examples:
- Household of 2 -- income of less than $67,640
- Household of 3 -- income of less than $85,320
- Household of 4 -- income of less than $103,000
- Household of 5 -- income of less than $120,680
You qualify for a plan with reduced out-of-pocket costs if your household income falls below 250% of the federal poverty level -- $31,225 for a single person (the government uses FPL standards from the previous year to determine eligibility).
If you qualify for a tax break, you'll see the premium savings as you shop and compare plans on the marketplace website. Keep in mind that catastrophic plans don't qualify for subsidies.
Comparing health plans
Think about your health care needs and budget, and then compare plans to find the best fit. Here are questions to consider:
How is the plan structured?
When choosing an individual plan on the ACA exchanges, you'll need to pick between four plans. The plans are divided by out-of-pocket and premium costs.
Decide whether you'd rather spend more upfront in premiums or more out-of-pocket costs if you actually need healthcare services. Once you figure that out, you can make a decision whether to go with Bronze, Silver, Gold or Platinum.
Who is in the network?
Check the health plan's network to make sure it has a good selection of hospitals, doctors and specialists. Make sure the providers you want to see are included in the network.
What is covered?
Check to see if the prescription drugs you take are included in the plan's list of covered medications. Compare other benefits. Some plans may go above and beyond coverage mandated by law.
How much do you pay out-of-pocket for care?
Review the deductible, copayment and co-insurance amounts. The deductible is the amount you pay each year for covered benefits before the health plan pays anything (except for preventive care). The copayment is the fee you pay for each office visit. Not all health plans have co-payments. Co-insurance is the percentage of covered health care costs you pay after you have met the deductible.
How much do you pay for coverage?
Compare the annual premium among health plans with the same coverage.
What's the bottom line?
Think about how much healthcare you will probably use in the next year. Compare how much it would cost in health insurance premiums and out-of-pocket expenses for each plan you consider. If you rarely go to the doctor, you are probably better off buying a high-deductible health plan (like a Bronze plan). Bronze plans have a lower premium than other plans, but also more out-of-pocket costs.
Making a smart health insurance choice requires time and effort, but the homework you do now will pay off later when you and your family need care.
Related >> Guide to Health Plans